Obama, Congress Work to Sell $2 Trillion Debt Deal

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Leaders on Capitol Hill are corralling their members Monday to line up in support of a debt agreement that would avert a default which could cripple the U.S. and global economies.

"I want to announce that the leaders of both parties in both chambers have reached agreement to reduce the deficit and avoid default," President Obama announced to the nation Sunday night.

Many breathed a collective sigh of relief that Washington could come together to avoid what many had been predicting: a financial unknown.

Now congressional leaders are left with the daunting task of selling the plan to skeptics on both sides of aisle.

"Both parties gave more ground than they wanted to. And neither side had gotten as much as it had hoped. But that is the essence of compromise," Senate Majority Leader Harry Reid, D-Nev., said.

The deal will increase the debt ceiling in phases by $2.4 trillion through the 2012 elections.

But it also immediately cuts spending by about $1 trillion and requires a special joint congressional committee to find another $1.5 trillion in savings by November.
If Congress can't agree to those savings, then automatic across-the-board spending cuts kick in, targeting Medicare and the Department of Defense.

Steep defense cuts may keep some conservatives from backing the agreement, along with the fact that a balanced budget amendment is no longer required.

On the other side, some progressives feel the spending cuts on entitlements go too far.
Emanuel Cleaver, chairman of the Congressional Black Caucus, called it "a sugar-coated Satan sandwich."

Although the deal doesn't raise taxes, opponents worry that the bipartisan committee could bring them back to the table - something the White House already alluded to.

"And what that's going to work on is the items that the president was focused on with Speaker Boehner. They're not going to reduce the deficit without tax reform, without entitlements," White House Senior Advisor David Plouffe told ABC's "This Week."

For now, some conservatives believe they can claim victory because they shifted the conversation and culture of Washington from spending to cutting.

"I think we've made dramatic progress in that direction since April, for example, when the administration was asking us to raise the debt ceiling with no spending reductions at all, nothing, just a clean debt ceiling," Senate Minority Leader Mitch McConnell, R-Ky., told CNN.
The financial sector, however, is reacting well to news of the agreement, with the markets rebounding after Sunday's announcement.

But credit ratings agencies say there's still no guarantee that the U.S.'s AAA debt rating will remain intact.

The president and Congress still have other serious worries ahead of them - like an economy that's growing at less than 1 percent so far this year. Unemployment is still over 9 percent.

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John Jessup

John Jessup

CBN News Anchor

John Jessup serves as the main news anchor for CBN, a position he assumed after 10 years reporting for the network in Washington, D.C. His work in broadcast news has earned him several awards in reporting, producing, and coordinating elections coverage. Follow John on Twitter @JohnCBNNews and "like" him at Facebook.com/John.V.Jessup.